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Presentation by Diné Power AuthorityBen Hoisington, Project Administrator
Presentation toOffice of Energy and Efficiency and Renewable Energy
TRIBAL ENERGY PROGRAMOctober 24, 2006
FY2006 Program Review MeetingDenver, CO
PADD I N E ' P O W E R A U T H O R I T Y
DPA Overview• Diné Power Authority (DPA) is an enterprise
and instrumentality of the Navajo Nation established under Title 21 NNC §201 of the Navajo Nation Code.
• DPA was created in 1985 by the Navajo Tribal Council for the purpose of developing wholesale, high-voltage electric transmission and generation projects for the economic benefit of the Navajo Nation.
DPA Overview, cont’d
• DPA’s current energy development projects include:– Navajo Transmission Project (NTP)– Desert Rock Energy Project (DREC)– Dine Wind Project 1 (DWP1)– Review and assess other potential utility-scale,
energy development projects including solar, wind, IGCC, coal-to-fuel, grain-to-fuel, biomass, and other energy-related projects, both renewable and non-renewable
Navajo Transmission ProjectNavajo Transmission Project
October 2006 Status UpdateOctober 2006 Status Update
NTP Purpose & Need• Improving the economic situation for the Navajo Nation based
on revenue that would result from the development of the NTP.
• Relieving transmission system constraints in the Four Corners Area.
• Increasing operating flexibility and reliability of the regionaltransmission grid.
• Allowing economical power transactions utilizing the transmission system.
• Facilitating future development of Navajo energy resources.• In 2005/6 about 6,000 MW of the Arizona generating plants
will be over 30 years old.
NTP Project Description• The NTP will be a 500 kilovolt (kV) transmission line
extending from Western Area Power Administration’s Shiprock Substation in northwestern New Mexico to the Marketplace Substation south of Boulder City, Nevada. The approximate length of the line will be 469 miles.
• Segment 1 will extend from the Shiprock Substation west for approximately 189 miles to a point south of Page, Arizona on the Kaibito Plateau.
• Segment 2 extends about 62 miles to the Moenkopi Substation south of Cameron, Arizona. An interconnection substation to the existing transmission grid would be constructed at either the Northern end of this Segment on the Kaibito Plateau (Red Mesa) or on the Southern end near the Moenkopi Substation.
• Segment 3 will extend about 218 miles from a point near the Moenkopi Substation to the Marketplace Substation.
Navajo Transmission Project (NTP)Proposed 470 miles Right-of-Way
Segment 3:218 miles, crossing Navajo Reservation, HualapaiReservation, U.S. Forest Service – Kaibab National Forest (USFS), State of AZ, BLM (Kingman & LV field office), National Park Service - Lake Mead National Recreation Area (NPS), Bureau of Reclamation, Boulder City, and private lands.
Segment 2:62 miles, crossing 23.66 miles of Bennett Freeze area & 0.44 miles of Navajo Indian Allotment Land within the Navajo Reservation
Segment 1:189 miles, crossing BLM (Farmington Field Office), State of NM and Navajo Reservation
NTP Progress Status• Western Area Power Administration (WAPA)
Record of Decision (ROD), 1997.• Arizona Corporation Commission CEC approval,
2000.• System Impact Study completed.• Path Rating Study in progess.• New Federal Lead Agency - BLM• New Record of Decision anticipated in 2006.• NN Archeology Department completed
archeological surveys in Segment I of NTP • MOA with Hualapai Tribe
Key 2006 AchievementsKey 2006 Achievements• Regular weekly coordination meetings with
cooperating agencies on expectations for NEPA, Section 106, and Section 7 compliance.
• Completion of cultural surveys along centerline of NTP (Segments 1 and 2).
• Completion of Mesa Verde cactus surveys along Segment 1.
• Development and pending submittal of Biological Assessment and supporting documents.
• Progress with the Hualapai Tribe regarding right-of-way negotiations in Segment 3.
•Development Agreement with Sithe Global for Segments 1 and 2 signed.
Next MilestonesNext Milestones• Submittal of BA, initiation of formal
consultation.
• Field work and data recovery plan for cultural resources.
• Updated Plan of Development.
• Record of Decision
• Notice to Proceed
Big PictureBig Picture• Tremendous emphasis on regional
transmission planning throughout the western US.
• Recent California emissions legislation further limits potential for generation to occur there.
• NTP is seen as a key component in regional power transfer.
Desert Rock Energy Project (DREP)
• An up to 1,500 MW mine-mouth, coal-fired electric generation facility
• The Desert Rock Power Plant and the associated Fuel Supplying Coal Mine are Located in the Nenahnezad and Burnham Chapter Areas of the Navajo Nation, San Juan County, New Mexico
• Fuel: Navajo Coal from adjacent BHP Mine• Estimated cost of Desert Rock is $2.8 Billion• Construction to begin in 2007 with an online, in-
service date in 2011
Project Site Map
Desert Rock EIS StatusUS Bureau of Indian Affairs (BIA) is lead agency responsible for the
completion of the Environmental Impact Statement (EIS)
9 Scoping meetings December 2004
Scoping Report
Cultural, Archeological, and Biological Studies
Complete
Draft EIS & Draft Record of Decision
Final Record of Decision
Spring/Summer 2006
September 2006
2005
Winter 2006
Desert Rock - Steps to Air Permit
Air Permit Application
February 2004
Draft Air Permit
July 2006
Public Comment Period
Final Air Permit Winter 2006
Start of development of the Air permit
September 2003
Status today
20072006200520042003
Desert Rock: The Next Step To Near-Zero EmissionsFrom Coal-Fired Generating Plants
Emissions from CoalEmissions from Coal--Fired Generating PlantsFired Generating Plants
* EstimateSource: EPA’s Clean Air Markets database; EIA 2004 Annual Energy Outlook; GE Energy; SFA Pacific.** EstimateInserted by DPA for discussion purposes only in showing relationship of Desert Rock estimated emissions.
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
Poun
ds P
er M
illio
n B
tu
Sulfur DioxideNitrogen Oxide
U.S.Average
2004*
Clean AirInterstate
Rule2010
New Midwest
Mine-mouth
Clean AirInterstate
Rule2015
0.10
0.340.39
0.16
0.26
0.120.182
0.07 0.06
0.94
New PRB Plant
Near-Zero
FutureGenGoals
0.030.06
IGCCProjection
ExistingIGCC
(PermitLevel)
0.17
0.08 0.06
DREP 2004 Air Permit
Application
0.06
Air Permit• Desert Rock submitted an application with the
lowest emission rates for any pulverized coal fired power plant in the US to minimize impacts to the environment
• Permit Application Submitted March 2004– 98% Removal of SO2
– 99% Removal of Particulate Matter– 80% Removal of Mercury– 98% Removal of NOx
• Application Deemed Complete in May 2005• Extensive Modeling Completed per EPA, NN EPA,
and National Park Service Requirements
Desert Rock Benefits :Employment Opportunities
• Job training opportunities • Estimated Employment
• Average of 1,000 construction workers per year for 4 plus years
• 200 employees for power plant operation• 200 employees for coal mine expansion• Estimated 1 additional job will be created for every 2
jobs created at Desert Rock during construction– During Construction – 1,000 additional local jobs– Operations – Sustain 60 local jobs
*Neff + Ricci, LLP, 2003
Tax, Royalty, and Lease Revenues
Coal Royalties$18,000,000 per year
Navajo Taxes$8,000,000 per year
Indirect Payments
Navajo Taxes$20,000,000 per year
Direct Payments
Water and Lease payments$ 5,300,000 per year
Desert Rock
BHP Navajo Mine
These Benefits Do Not Require Navajo Investment
Sithe Global - Overview• Sithe Global Power is a privately held independent
power development company developing power generation projects worldwide
• Formed from the management and development teams of Sithe Energies and Steag Power in 2004
• Owned by Blackstone Capital Partners and Reservoir Capital Group
• Team of experienced developers with significant solid fuel experience
Desert Rock and NTP Summary• Desert Rock and Navajo Transmission Project
will:– Generate over $52 Million per Year over the life of the
plant– Increase direct & indirect NN Employment
opportunities linked with education & training– Deliver long term benefits to the impacted chapters– Equity ownership opportunities for Navajo Nation– Sets a benchmark for Clean Coal Generation
Energy projects will be a Catalyst for Continued Economic Development on the Navajo Nation
Diné Wind ProjectDiné Wind Project
• Project Goal: 200 MW wind project on Navajo lands• The Diné Wind Project is moving forward quickly to capitalize on
favorable market conditions • Benefits to Navajo Nation include: taxes and site lease payments,
DPA ownership interest, job creation and economic development, Citizens Local Benefit Program
Diné Wind ProjectDiné Wind Project
• Target date for construction to commence is 2008-2009
• Diné Wind Project to compliment other ongoing Navajo wind development efforts
Wind Project Stages200 MW Wind FarmWind Project Stages200 MW Wind Farm
Site Selection• 1-2 Months• ~$50,000
– Wind maps– Transmission– Road access– Land use– Environmental
Development• 2-4 years• $1-2 Million
– Wind assessment– Interconnection– Layout– Environmental study– Permitting– Power Contract– Financing– Procurement
Construction• 1-2 years• $300 Million
– Turbines– Foundations– Roads– Collection system– Substation– Facilities
DPA and Citizens Joint Venture DPA and Citizens Joint Venture
• Memorandum of Understanding entered July 2006• Joint development activities commencing Sept. 2006
– Project Feasibility– Site control and layout– Wind resource assessment– Preliminary engineering – Environmental review
Diné Wind Project BenefitsDiné Wind Project Benefits
• 200 MW project could produce tax revenues, lease payments and royalties
• ≈ $3-5 million per year for Navajo• Job Creation - Local Employment
– Temporary construction jobs• ≈ 100-200
– Long-term operations and maintenance jobs• ≈ 10-20
– Job training• Citizens Local Benefit Program
– Percentage of profits provided for foundation or other programs for the benefit of the Local Community
• Build Navajo skills and knowledge base
Diné Power Authority: Advantages to Renewable and Sustainable Energy
Diné Power Authority: Advantages to Renewable and Sustainable Energy
• In today’s world, there is an immediate need to combine and balance today's technology with the available natural resources to create an economic development process that will provide for the Navajo Nation, and it’s peoples immediate economic needs, as well as produce and nurture social growth that has future needs and environmental obligations in mind.
Thank YouThank You
Questions on Wind Project?Please Contact Us:
Dine Power Authority: Ben Hoisington(928) [email protected]
Citizens Energy CorporationRoger Freeman(617) [email protected]
For Further InformationDiné Power Authority (DPA)
Window Rock, AZ(928) 871-2133
Steven C. Begay, General ManagerEmail: [email protected]
Sithe Global Power, LLCDirk Straussfeld, Senior Vice PresidentEmail: [email protected]
Nathan Plagen, Project Development DirectorEmail: [email protected]
www.desertrockenergy.com
